Chapter 11 - Corporate Social Responsibility And Sustainability Flashcards Preview

Corporate Governance > Chapter 11 - Corporate Social Responsibility And Sustainability > Flashcards

Flashcards in Chapter 11 - Corporate Social Responsibility And Sustainability Deck (20)
Loading flashcards...
1
Q

Define CSR

A

“Business decision making linked to ethical values, compliance with legal requirements and respect for people, communities and the environment.”

(Business for Social Responsibility)

2
Q

Outline some example of how companies might act in accordance with an awareness of social responsibility

A
  • treat employees with respect
  • operate ethically
  • respect human rights
  • sustain the environment
  • be responsible neighbours
3
Q

What is a corporate citizen?

A

A company that seeks to behave as a good citizen, by respecting its social responsibilities.

4
Q

Define sustainability.

A

“Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

(Brundtland Report 1987)

5
Q

What are the six capitals whose value companies should seek to maintain or enhance?

A
Financial
Manufactured
Human
Intellectual
Natural
Social
6
Q

What is another term for “CSR”?

A

Corporate citizenship.

7
Q

With which corporate governance approach is CSR in accordance?

A

The stakeholder approach.

8
Q

What is the six capitals model?

A

The concept that an organisation creates or destroys value over time using and affecting 6 types of capital.

9
Q

Who loves you?

A

Jade loves you xx

10
Q

What are the three pillars of CSR?

A

1 Economic objectives
2 Social objectives
3 Environmental objectives

11
Q

Which three bodies drive the concern for CSR?

A

1 Governments
2 Investors
3 Companies themselves

12
Q

What are the general OECD Guidelines for multinational companies?

A
  • contribute to economic, social and environmental development
  • respect human rights
  • encourage the development of local business
  • encourage the development of human capital
  • refrain from seeking exemptions to local laws
  • support good governance
  • avoid improper involvement in local politics.
13
Q

How does UK law encourage CSR?

A

CA S172 requires directors to promote the success of the company while having regard to:

  • the interests of the company’s employees
  • the need to foster relationships with suppliers and customers
  • the impact of company’s actions on the community and environment
  • the desirability of maintaining a reputation for high standards of conduct
14
Q

Why were the OECD guidelines for multinational companies considered necessary?

A

To encourage the positive contributions that multinationals can make to economic, social and environmental progress.

15
Q

Define SRI.

A

Socially Responsible Investing

16
Q

Explain three approaches to implementing an SRI strategy.

A
  • engagement (seeking to persuade a company toward CSR)
  • investment preference (investing based on a balance between CSR requirements and financial opportunities)
  • screening (only investing in companies that meet certain criteria).
17
Q

Name 2 CSR Indexes

A

1 Dow Jones Sustainability Indices

2 FTSE 4 Good

18
Q

How might companies be affected by a bad reputation for concerns about social and environmental issues?

A

They lose consumer and investor confidence and may be subject to government sanctions (e.g. BP)

19
Q

What are the potential benefits of CSR?

A
  • reduced reputational risk
  • reduced business probity risk
  • PR and marketing benefits
  • commercial and financial benefits
20
Q

How has AkzoNobel incentivised CSR?

A

By making 50% of director remuneration linked to CSR targets.